Drilling for Deep Drilling for Deep Geothermal Geothermal Exploration, Slim Exploration, Slim Holes and Large Holes and Large Diameter WellsDiameter WellsOctober 3, 2008October 3, 2008

Louis E. Capuano, Jr.Louis E. Capuano, Jr.President & CEOPresident & CEO

ThermaSource, Inc.ThermaSource, Inc.

Well Drilling

• Take recommendations from the Geologic / Geophysical staff• Drill exploration or development well that penetrates target• Given a location and true vertical depth to a target • Develop surface location as close to target as possible

–reduces directional work needed to get to desired location

• Drilling department develops drilling program to penetrate the target

–completes well with hole size and casing program to maximize production from the well

Differences of Drilling Geothermal vs. Oil/ Gas Wells

1. Temperature2. Low reservoir pressure – sub-hydrostatic3. Hard rock drilling – volcanic4. Large production rate

Well Drilling

• Pertinent data is required to adequately design and drill the well• Goal is to develop drilling program then a cost estimate

for budgeting purposes• Questions that we need answered in order to develop a

drilling program and cost estimate:– Location of the well – Governmental regulations for the area to be drilled– Proposed depth of well– Proposed production interval– Production hole diameter (final hole size)– Nature of the Resource (Will the well flow on its own or need to be

pumped?)

Well Drilling

Questions that we need answered in order to develop a drilling program and cost estimate: (continued)

– Elevation of the well– Proposed lithology– As much information as possible from nearby wells– Expected temperature profile of the well

Determining Drilling Programs

Slim Hole• Cost = Low• Speed• Limited information

gained

Large Bore Wells• Exploration wells can

be converted to production wells

• Cost = High• Full range of

information gained – Reservoirs can be

tested and evaluated

Slim Hole vs.Large Bore Wells

Well Drilling

• Develop a completion program based on available lithologic information, resource type (flowing or pumped), resource temperature and depth

• Define hole and casing size and approximate setting depths

Large Bore Well

Profile

30” – 12.25” Hole

Large Bore Rigs/Wells

Slim Hole Well

Profile

8.5” – 3.5” Hole

Slim Hole Rigs/ Wells

Well Drilling

• Develop step by step drilling program. – This program will put in order the steps to drill and

complete the well

Example of Large Bore Drilling Program

Drilling Procedure - Operations in sequence:• Prepare Location

– Install 30” conductor pipe to 50’ and install cellar around the same

– Prepare sump and pad to fit rig layout • Move in Rig and rig up on well

– Center Rig over conductor– Extend conductor to appropriate height for safe working – Begin building spud mud volumes in mud pits

• Make up 26” BHA and spud through 30” conductor

Drilling ProgramDrilling Procedure - Operations in sequence: (continued)• Drill 26” hole to 400’ +/- with mud

– Circulate and condition wellbore for casing and cementing – POH with 26” drilling assembly

• Pick up and run in the hole with 20” 94 ppf casing– Make up casing with float shoe on bottom and stab-in collar 1

joint above float shoe– Once casing is landed on bottom, Stab into collar with drill

pipe – Pump cement through drill pipe and up through the annulus

until cement returns to surface• Wait on Cement

– Wait for approximately 12 hours before testing cement bond – If needed perform a top job to seal surface casing

Drilling ProgramDrilling Procedure - Operations in sequence: (continued)• Cut off 30” conductor and 20” surface casing and attach Blowout

equipment – Install a slip-on wellhead on 20” casing and weld the same– Install BOP stack – Pressure test BOP and casing to 400 psi

• Pick up 17-1/2” Drilling assembly– RIH to stab-in collar and begin to cleanout cement – Drill out float collar, cement and float shoe

• Continue drilling 17-1/2” hole to 2000’ +/-– If lost circulation is encountered treat with LCM and monitor

lossesPull out of the hole for 13-3/8” casing

– Lay down 17-1/2” tools and rig up casing crew

Drilling Procedure - Operations in sequence: (continued)• Pick up and RIH 13-3/8” casing

– Make up casing with float shoe on bottom and stab-in collar 1 joint above float shoe

– Once casing is landed on bottom, Stab into collar with drill pipe

– Pump cement through drill pipe and up through the annulus until cement returns to surface

• Wait on Cement – Wait for approximately 12 hours before testing cement bond – If needed perform a top job to seal surface casing

Drilling Program

Drilling Program

• Assign time to each step in the procedure. This establishes a drilling curve (Days vs. Depth)

Drilling Curve

for Slim Hole & Large

Bore Dep

th (f

t)

Drilling Days0 2 4 6 8 10 12 14 16 18 20 22 24 26

0

100

200300

400500

600

700800

9001000

1100

12001300

14001500

1600

17001800

19002000

2100

22002300

24002500

2600

27002800

29003000

3100

32003300

34003500

3600

37003800

39004000

Planned

Well Drilling

• Design detailed casing program:– Based on hole size, casing size (O.D.) and approximate

setting depth, we then design to casing string– Establish casing grade, weight per foot and

connection type– Design casing based on manufactured properties of

the casing weight and grades, API (American Petroleum Institute) established manufactured properties for:

• Collapse (ability to resist external pressure – that is a crushing action)

• Tensile strength – suspension ability of the pipe• Burst – ability to resist internal pressures

Well Drilling

• We use these properties to design the best casing for the job.

• We attempt to get the best weight and grade to reduce cost and resist corrosion from the produced resource.

Wellhead and Valving

• Design the Wellhead and valving needs for the well:– Factors to consider:

• Flowing well• Vapor or liquid dominated resource• Pumping well• Blow out prevention system needed during

drilling

Example of:Large Bore

Wellhead and Valving

Drilling System Design

Each section of the well must be drilled with the best systems to allow casing to be set and cemented. Various systems are available:

• Mud Systems have many purposes; cool bit and drill strings, lubricates, carry’s out cuttings, holds back and balance wellbore and resource pressures and helps to keep poorly or unconsolidated formations in place

• Aerated System is a mixture of mud or water and air injected within. Used in areas of low reservoir pressures and poorly consolidated formations

• Air Drilling uses compressed air in areas of vapor dominated resources

Cementing

A cement slurry and procedure is designed to completely fill all annular spaces between the casing and the wellbore:

•Good cementing is the key to success in geothermal well completions:

– It reduces expansion due to temperature– Reduces casing problems due to trapped voids of mud or water

between casings

•Cement is designed to:– Give adequate pumping time– Produce adequate compressive strengths once it is hard and set– Develop good bonding between casing and wellbore & casing

and casing

Large Bore Well Directional Program

• A program is developed to drill the well vertically and then deviate the well into the desired direction to the target.

• The deviation of the well is built up to a value that reaches the target into the direction of the target.

• The program is submitted to directional service companies for procedures, tool requirements and cost estimates.

Slim Hole Well Straight Hole

Large BoreDirectional

Well Program

Bid Process• The bidding process establishes availability and prices • The process begins once all programs have been designed and materials and services specified:•Casing and drilling loads can be determined as well as pumping needs and drilling rig requirementsThe most important factors are:

– Derrick capacity– Draw works horsepower well pulling capacity– Substructure height– Pumping output– Power needs– Space requirements– Drill pipe size and grades

• Bids are received and evaluated. A cost estimate is developed based on bids and days vs. depth curve.

- Mud system capacity - Mud cleaning equipment- Rotary table size - Fuel consumption- Day rate- Mobilization/Demobilization

costs- Extra provided equipment

- Forklift - BOPE

Well Cost Estimate

Large Bore Well Testing Program

• A testing program is developed based on the resource:– Vapor dominated resource

• Flow rate• Downhole measurement (PTS)• Discharge requirements• Resource sampling

– Fluid dominated resource• Flow rate and lifting method

– Pumped– Air lifted

• Downhole measurements (PTS)• Discharge requirements• Resource sampling

• A final analysis is completed for reservoir evaluation and resource size.

Contingencies

• Slotted liners• Option to run and cement additional casing strings as required• Special handling needs

– Hot liners– Welded pipe and casing

• Additional blow out preventer needs and rotating heads• Sumpless operations• Abatement of emissions during drilling• Air compressors• Air, steam and cuttings separators. Discharge re-circulating

systems• Handling poorly consolidated formations• Corrosion• Mud Coolers

Questions?

Thank You